Two California-based companies, JEV&B Services LLC and D4 Inc., along with their owners William Nelson and Vicki Rollins, have agreed to pay a total of $153,598.90 to settle claims that they submitted false information to secure Paycheck Protection Program (PPP) loans they weren’t qualified for.
This settlement resolves allegations brought under the False Claims Act.
Understanding the Paycheck Protection Program and Its Rules
The PPP was created by Congress in March 2020 as part of the CARES Act to help small businesses survive the financial fallout from the COVID-19 pandemic.
It provided forgivable loans to eligible businesses to help cover payroll and other expenses.
The Small Business Administration (SBA) oversaw the program, which also protected banks by reimbursing them for processing these loan applications.
To make sure the funds reached the intended small businesses, the PPP set clear eligibility rules—most notably limits on the size of businesses that could qualify.
When a second round of loans opened in 2021, these size limits became even stricter: second-draw loans were only available to companies with 300 or fewer employees, including any affiliated businesses.
Allegations of Misrepresentation on Loan Applications
As part of their loan applications, businesses had to disclose affiliated companies and provide an accurate count of total employees.
They also had to certify their eligibility and attest that all the information they provided was true.
The government alleged that JEV&B Services and D4, which are connected through their owners Nelson and Rollins, shared common ownership with several other companies.
Both JEV&B and D4 received first-round PPP loans that were later fully forgiven.
However, the problem arose with the second-round loans: authorities claimed these two companies were not eligible because their combined employee numbers far exceeded the 300-employee cap.
The government further contended that Nelson and Rollins knowingly deceived their lender by under-reporting employee numbers, hiding affiliated companies, and falsely certifying their eligibility for the second-draw loans.
In short, the information on their applications was inaccurate.
Settlement Details and Next Steps
To resolve these allegations, the companies and their owners will pay $153,598.90, which includes reimbursing the SBA for processing fees tied to the loans.
They have also agreed to repay the loans in full, removing the SBA’s risk related to these improper loans.
Whistleblower’s Role in Uncovering the Case
This settlement also settles claims made under the False Claims Act’s whistleblower provisions, brought forward by Ashwani Chawla.
These provisions allow private individuals to sue on behalf of the government and receive a share of any recovery.
Chawla will receive $11,519.92 from the settlement.
Coordinated Government Effort and Legal Handling
The case was handled through a joint effort involving the Justice Department’s Civil Division, the Commercial Litigation Branch Fraud Section, and the SBA’s Office of the Inspector General, along with support from the SBA’s Office of Capital Access.
Trial attorney Christopher Belen from the Justice Department managed the matter.
Final Notes on the Settlement
It’s important to note that the claims settled in this case remain allegations only.
There has been no official finding or admission of wrongdoing by JEV&B Services, D4, Nelson, or Rollins.